St. Thomians Turn Out In Massive Numbers For Protest Against Sin Tax Bill

ST. THOMAS — A protest in St. Thomas near the Earl B. Ottley Legislative Hall this morning has placed into perspective the strong opposition that Governor Kenneth Mapp’s sin tax measure — which is being heard today in the Committee on Finance — is facing from the Virgin Islands community.

A massive crowd lined both sides of the road near the Legislature, demanding that senators vote against the sin taxes, which aims to either introduce or raise taxes on rum, beer, tobacco and sugary drinks, as well as internet purchases and timeshare unit owners.

In unison, the crowd, many of them business owners, shouted, “No more taxes!” They held up multiple signs with all sorts of writings, including, “legalize it,” referring to the legalization of marijuana in the territory, “Bring in summer cruise traffic,” relative to more cruise ships during summer months in St. Thomas, the territory’s main tourism hub. And another that read, “No wasteful spending, no borrowing and no new taxes.”

Today’s protest is the strongest demonstration of opposition to the sin tax measures to date. It brought a broad coalition of business owners and community members together with the singular goal of persuading lawmakers to listen to their collective voices.

But early responses from lawmakers, mostly the Democrats, give little hope that the measure will be voted down. Senators Kurt Vialet, Nereida Rivera-O’Reilly and Neville James, all spoke in favor of supporting the sin tax measure, even as they commented on the difficulty of the decision. Mr. Vialet said while he understood that the bill is unpopular, he said the bond market, whose dollars have sustained the territory’s structural deficit for years, was tired of hearing talk. “We can’t sit here, do nothing and believe we’re going to solve the problems,” Mr. Vialet said. Mr. Vialet reminded the public of the 31st Legislature’s stalemate with Mr. Mapp, when it opposed vehemently the governor’s plan to raise his department and agency heads’ salaries by thousands of dollars, as a testament to the Senate’s opposition to wasteful spending.

He also challenged Mr. Mapp to implement austerity measures in his administration, beginning with the elimination of retirees who hold top positions at departments and agencies.

Mr. James said the last thing that any senator wants to do is raise taxes. But, he went on, the current situation calls for difficult decisions — in his opinion, those that benefit the territory — to be made. And Mrs. Rivera-O’Reilly frowned on the thought of the territory’s finances being managed by a federal control board, à la Puerto Rico. “We were told [that] the day we run out of cash, is the day we become the jurisdiction of a financial oversight board,” she said.

The Consortium will have a full story on the hearing Thursday morning. (Update: 6:53 p.m. The hearing is still ongoing).

Executive Order

As the Government of the Virgin Islands comes face to face with a financial crisis that threatens to interrupt a vast amount of its operations, Governor Kenneth Mapp has signed an executive order that Government House says limits the use of government-owned vehicles, puts a freeze on non-essential hiring, suspends wage negotiations, and freezes non-essential travel paid for by the GVI.

Government House deemed the order as a “major” step in reducing the cost of government operations, “given that cash revenues flowing into the treasury are insufficient to meet current expenses,” reads the release, issued late Tuesday.

The order comes just ahead of a Senate hearing in the Committee of Finance set to take place today at the Earl B. Ottley Legislative Hall in St. Thomas. And it comes even as pressure continues to mount on lawmakers; a coalition of St. Thomas businesses is set to protest the measure this morning in front of the Legislature.

The order, a copy of which was not attached to the Government House release, cites the need for “immediate and comprehensive action to reduce current spending”, while ensuring, to the extent possible, that essential services to protect public health, safety, and welfare are preserved. And it freezes all non-essential hiring in all executive branch department and agencies, with the following exceptions:

Positions in departments and agencies that are fully funded by and paid through federal grants and non-general fund monies.

Emergency and public safety positions.

Teaching positions within the Departments of Education and Human Services.

Employment positions mandated by federal court consent decrees.

According to Government House, the order also suspends immediately all wage negotiations pursuant to the instructions contained in the ruling of the United States Court of Appeals for the Third Circuit in the VIESA Case. Additionally, until further notice, the order suspends non-essential travel paid for out of the government’s general fund, and directs heads of departments and agencies to limit 24-hour use of non-emergency government vehicles to employees whose functions are essential and require use of government vehicles after work hours on a regular basis, according to the release.

The order also includes Governor Mapp’s request that the other branches of the territorial government and instrumentalities not under the direct authority of the governor (i.e. the hospitals, the University of the Virgin Islands, the V.I. Waste Management Authority, and all others which receive funds from or intend to hire based on funding from the general fund) implement similar or other mitigating measures designed to achieve the goals of the executive order.

Government House says the order takes effect immediately and will terminate when a subsequent written executive order is issued by the governor.

Acute Financial Situation

The GVI is short $110 million in its current budget, and the bond market is refusing to open its pockets to the territory. The situation leaves the government with no other option but to immediately find ways to cut costs by implementing austerity measures and attempting to enact legislation aimed at generating revenue.

But while Mr. Mapp is calling on lawmakers to pass his five-year economic growth plan, dubbed the sin tax measure which seeks to introduce or increase taxes on beer, rum, sugary drinks and cigarettes, as well as internet purchases and timeshare unit owners, the bond market may remain closed to the territory for as long as a year. Furthermore, if the sin taxes were to be signed into law, the bill’s effect on the economy — good or bad — would not be accurately assessed for a long time.

In light of this, Dept. of Finance Commissioner and Public Finance Authority Director, Valdamier Collens, in an exclusive interview with The Consortium two weeks ago, said difficult decisions must be made immediately to correct the territory’s dismal financial condition.

“It’s not even an assumption anymore, we have to act in a way in which we don’t have access until we demonstrate to ourselves — not to the bond market — that we want to fix our structural deficit. So for starters we know $110 million is out of the budget, and so we have to act accordingly to adjust and revise our budget,” Mr. Collens said.

Mr. Collens said the territory would not even attempt to access the market anytime soon, whether or not the 32nd Legislature passed the governor’s proposed five-year economic recovery sin tax measure. And even if the measure were to become law, both the bond market and the government would wait up to a full year or more before restarting negotiations. The commissioner’s words were a blunt and sobering acknowledgement that the financial collapse was no longer going to happen, but is now in play.

This means, Mr. Collens acknowledged, the furloughing of government employees, cutting back on government services, deep cuts in the budgets of all government departments and agencies, assessing positions within the government and searching for areas where excess and positions could be eliminated.

“We have to show investors that we are willing to look at new revenue enhancement measures, as well as [moderating] our expenditures. The thing is we have to realign and right-fit our budgets to ensure that this misalignment doesn’t occur — because if you don’t have access, well then you have to fix your budget,” Mr. Collens said.

“If we are able to pass measures that investors will view as we are addressing our structural deficit, that would bode well to the investors, but they’re not going to jump out tomorrow and say, ‘Oh, come back to the market.’ They’re not going to do that,” he added.

Mr. Collens likened the situation to people who lost their homes during the 2008 housing crisis and could not pay their mortgages. A wide swath of them had to foreclose on their homes.

“What that person does, they go through the foreclosure process, deleverage, fix their credit, and that takes a little bit of time. And then once all of that is corrected — which could take three months, six months, a year — that’s when you can say, ‘Okay, now I’m going to apply for a loan because I know the probability of a denial letter is low,” Mr. Collens said. He said the government shouldn’t be doing anything that is going to generate new revenue based on the market’s decision to stop lending to the territory. “We should be doing it to correct the problems that we have and once that’s done, and we feel like we have addressed a material amount of issues, it is at that point that we could then go back and approach the market for, say, capital projects, just to give you an example,” Mr. Collens said.

Asked whether that meant government employee reductions, furloughing, 4-day work weeks, and cutbacks in government services, Mr. Collens said that was “absolutely” what was going to happen.

“A combination of all of what you said is on the table because the issue, and I want to be very clear, the issue is liquidity. Cash. Do you have cash to pay for expenses that are here today, and because we don’t have access to our line of credit, because we can’t go to the bond market and get access to working capital, we’ve got to fix these things and we’ve got to develop a stringent plan,” Mr. Collens said.

Ernice Gilbert
I wear many hats, I suppose, but the one which fits me best would be journalism, second to that would be radio personality, thirdly singer/songwriter and down the line. I've been the Editor-In-Chief at my videogames website, Gamesthirst, for over 5 years, writing over 7,000 articles and more than 2 million words.
I'm also very passionate about where I live, the United States Virgin Islands, and I'm intent on making it a better place by being resourceful and keeping our leaders honest. VI Consortium was birthed out of said desire, hopefully my efforts bear fruit. Reach me at ernice@viconsortium.com.

If the Senators vote to make the Sin Tax Bill a law, we have one solution
come November 7, 2018! VOTE THEM ALL OUT BY A LANDSLIDE!!!!! Simple!!!!

Nathan

That’s all!! their unanimous vote in favor would show that they have no regard for their constituents.

Really? Really?

They will play their usual game as they do with every controversial bill… just enough votes to pass, one or two abstaining, and one or two absent. That way we never know who to stay mad at.

Crime Victim

Sure we do… ALL OF THEM

World’s Moistest Jheri Curl

if you’re against the sin tax then deGraff, Millin-Young & Tregenza is voting against it so don’t penalize them. (that’s the STT contingent not sure how STX Senators will vote).

This will really come down to STX. The STT Senators are split 3/3 and if the STX Senators want this bill it’ll become law.

Dooreo

Generate revenues by going after those programs that are already in place, most specifically tax cheats. Millions are not being collected.

Really? Really?

Taxis anyone? The Taxicab commission has this govt by the balls.

cgtstx

What about a crime tax? If street garbage teif someone then he must pay a tax on what was taken. Yea, a tief tax.

Miss VI

YES! Let’s just tax every damn thing while we at it. We need to add an extra tax to restaurants to. So when Mapp take his fat ass to No Bones he have to pay tax on his damn bill!!

Crime Victim

Well, WE play his bill. He uses is USVI government credit card to pay for it so we get screwed again.
Vialet, you’re history. Roll over like a good lap dog. The only industry you have here is travel. This kills that! Cuba should be paying you because everyone will go there, it’s cheaper.
This place has lost its leadership… for a while now. It’s not wake up black people it’s wake up Cruzans.

Miss VI

I want to say that I am surprised at Violet. But as one of his former students, people
Looked at him being a good educator but have always look passed him being a self-centered a**! He cares only about Vialet and nobody else. He is not a fair minded person and thinks that success belongs only to him and his daughters! People will
Learn about his way of thinking.

Chief

He had people fooled for a long time, but his stupidity eventually bubbled to the surface. God forbid his major skeletons come out of the principals office.

TooTrue2BReal

Then all the senators gotta pay the teif tax for stealin’ their outrageous salaries? Hell, the teif tax on King Mapp alone will float government payroll for a year!

Really? Really?

Ha! Big up!

jimsmit

I find very amazing how the people who stand to benefit more , can get foolish black people out to march with them. Until we as people, the majority stop allowing the minority (massa) to call them out to demonstrate against their own black legislators.
we are the ones with diabetis and the cancers from the same products the these people are selling us.
People beware of who you marching with and for, black people wake up

Fhil

Awesome it’s now about race? Don’t worry I shut both businesses down and left your island….one less cancer you have to worry about!

You should truly look at breaking away from the diabetes and become your own sovereign country, I am sure it would do very well socially and financially?

Nathan

The tax will be passed on to the consumers! I love my green if it’s too expensive I gotta drink one. Damn.

S Anthony

Fhill, your last paragraph was so condescending and very telling. Goodbye and don’t come back.

Edghost

Condescending? Yes. But in what way was it “telling”? Please explain.

bradlevin

Yes, Fhil don’t let the door hit you in you know where when you are leaving. All of the items that are proposed to be taxed are tax heavily on in the mainland and I don’t see you there protesting the US government to drop the taxes.

Really? Really?

Why are you celebrating b/c someone closed two businesses and moved to the mainland? How does this make you and I better? We live in a tax free port, not a state. I don’t want to lose our ability to compete with the other Carib islands/ports who are duty free.

bradlevin

This port is not a tax free port. that’s false. the taxes are hidden in the price.

Really? Really?

I agree that gross receipts and excise are taxes- I’m saying we are “duty free” as in no sales tax. It’s a major part of our marketing campaign.

bradlevin

Correct!

Miss VI

I see where you’re coming from. Last week 10 people came out to protest WAPA’s law breaking price increase. The business community didn’t come out in droves with their signs to support the locals because at this point they mostly have their fancy solar panels to save energy and cut their home and business electric bills. But when it affects how much their going to make in profit when people stop buying products that are taxed they drag half the VI out to protest with them and we show up and show out.

Really? Really?

Regardless of their reasons, this tax is unjust and will not only hurt the businesses but their customers – you and I – and cause businesses to close, which reduces the gross rects tax that the govt collects, which will cause the govt to raise taxes again…. its a downward spiral!

Roberto Quintano

Same old, same old scare-tactic argument from the self-serving Chamber of Commerce.

I support the tax increases because they serve a healthy purpose and a common good. The businesses themselves will not be paying it…but rather the consumers. So what is “dah prablem”?

Funny. How many Arabs, Whites and East Indians occupy the streets when local Black execute each other? Does rampant murders drive tourists away from their businesses or affect their “bottom line.”

Really? Really?

Look at the pictures. My black brothers and sisters were out there too. This tax affects EVERYONE not just the white ppl… if you let them divide us, we all lose aka we must stand united as Virgin Islanders, not white vs black, bahn here vs continental, to save ALL of us from this Govt’s excessive spending (ceremonial vehicles but they can’t pay their power bill) on the backs of the taxpayers!

Roberto Quintano

There is a racial element to it. When the government finally collapses what will the Whites, Arabs and East Indians say?

They will say: “See there: Black People (the Natives) cannot do anything right. They are incompetent. Bring in the Feds.”

And laugh.

The very same people who own businesses which have received a variety of tax breaks–subsidies really–from our Black Government for many decades.

And they are financially prepared to pick up the pieces that Our Black People will have left behind when the Government comes crashing down. Houses, land and other assets will fall into their hands cheaply–as we abandon ship.

It was the depressed economy on St. John during the 1930’s and thereabout that compelled Black land owners on St. John to “sell out” to Rockefeller and his ilk–and today we see the consequences of that.

“Tink ’bout dat.”

Some people will dig their own graves without ever realizing it.

Roberto Quintano

Totally agree!

The ship is sinking and nobody wants to help. If you do not support the tax, then do not buy sodas, alcohol and cigarettes, the latter two purchased mostly by visitors. Simple.

But taxes need to be raised and cuts need to be made–and Nobody wants to make a sacrifice.

When the ship sinks the ones who will float are the wealthy business owners who are mostly Whites, East Indians and Arabs.

And local Blacks will drown as they lose their assets to the very same people mentioned above with whom they are foolishly marching.

Watch it and see.

Some of us are so stupid…!

bradlevin

Wow you can’t get these people actually out there protesting. I am lost for words. SMFH

In de now.

Well My Pees. It’s Beer:30 people’s! It’s time for a break.

STXMike

how much worst can it get?

World’s Moistest Jheri Curl

We don’t want to know lol

Shaba

Don’t like the idea of Internet tax. But go ahead and tax beer and cigars and soda

Really? Really?

The problem that I predict is that once they pass one tax bill, they will LIKE IT and start passing more…. no need to cut spending, we will just add another tax! The stupid ppl can’t stop us!

World’s Moistest Jheri Curl

I actually like the internet tax but dislike the time share tax.

World’s Moistest Jheri Curl

where were all these people during the State of The Territory address?

Really? Really?

You can’t change his address, but they did try to change the minds of the Senators who voted yesterday.

JD

So Mapp says that cutting his and the Senators salary is such a small little drop in the bucket that it is not worth talking about and will do nothing to help the deficit but his executive order to stop driving the Gov cars 24/7 will save millions??? How bad is the gas mileage on those cars? Mapp it is not the amount you will save it is the principle of it. If you show you are cutting your pay it will show that everyone is suffering you idiot.

Roberto Quintano

The Government needs to establish its own gas station depot to fuel its cars and buses–rather than buying gas at retail prices from private companies.

Another way to save money.

cruzaniron

They used to have one on STX. But like everything else, they didn’t maintain it and had to shut it down.

Roberto Quintano

OK. Sad.

Crime Victim

The buy at One Love…. hmmm owned by… a Senator

Roberto Quintano

Wow. In St. Thomas the governments buys at Gottleib. No discount.

Really? Really?

“Mrs. Rivera-O’Reilly frowned on the thought of the territory’s finances being managed by a federal control board, à la Puerto Rico. “We were told [that] the day we run out of cash, is the day we become the jurisdiction of a financial oversight board,” she said.” OMG YES YES YES DO IT YOU KNOW WE SHOULD >>> OMG THAT WOULD BE AMAZING!!!!!!!!!!!!!!!!!!!!!! We’ve proven we can’t manage our finances, so it’s time for Mommy and Daddy (Feds) to take the reins – better that than if they take away our allowance for being bad children!

VI4Life

St. Thomians are persons born in St. Thomas. Headline should read “St. Thomas residents Turn Out In Massive Numbers For Protest Against Sin Tax Bill”

World’s Moistest Jheri Curl

right… I saw that crowd. The Source’s articles have actually highlighted that fact. The crowd size was due to folks forcing employees to attend.

barnya

Just wondering: Are people who are against sin taxes in favor of sin? Just wondering.

Stop. We all know the message, it’s a fact and we now want to turn it into something that it’s not. SMH

Shaba

WHAT MESSAGE ? You mean you support this image???????

Chief

Look beyond the image and you’ll see the message. WE ARE PUTTING A NOOSE ON OUR CHILDREN! Notice that her message is getting the most attention?? If their a was any ill intent, she wouldn’t show her face. Adding to this, notice how the politicians are playing the emotional card?? They are taking the focus off of the subject matter.